Corporate Impact Investing Is a Critical Part of Solving Global Problems
As
the deadline for the United Nations’ 2030 Agenda for Sustainable Development approaches and challenges like poverty and climate change grow in urgency, corporations have an important role to play in supporting real change.
The current business model of “profits above all else” is no longer sustainable. World Economic Forum Founder Klaus Schwap describes corporations as social organisms that can bring the world closer to achieving shared goals. By investing in solutions to today’s problems, corporations can lead the creation of a new model where positive social impact and prosperity aren’t mutually exclusive.
The rise of impact investing Impact investing—investing in companies or funds with a strong social mission—is starting to gain traction among global corporations in recent years. “There is far greater demand today from investors to find products that are aligned with their social values,” says Leah Nguyen, investment director of the TELUS Pollinator Fund for Good, a $100-million fund investing in
companies focused on driving a positive social impact. Impact investing, guided by positive social principles, can directly fund the potential solutions to ongoing social issues. “Solving for the root cause of these critical societal issues requires innovation and disruption, and impact investing is the fuel that drives it,” adds Nguyen.
Breaking ground in a new industry Because impact investing is nascent, corporations pursuing the model are leaders in a new way of building business. The TELUS Pollinator Fund for Good focuses its investments in healthcare, economic inclusion, agriculture, and cleantech—core areas of the business that are deeply entrenched in the company’s social purpose values. These values are a “natural extension” of the corporation, says Managing Partner Blair Miller. “We see a vast pool of opportunity arising from the need to drive social change and solve global problems through technology; the market is a critical mechanism to drive that change,” adds Miller.
As impact grows, so do businesses For companies with a social mission at their core, it is possible for revenues to grow alongside the impact they create in people’s lives with the proper capital, changing how for-profit companies tackle complex issues. Raven Capital is an Ottawa and BCbased fund that invests in Indigenous entrepreneurs. Raven was founded to remove funding barriers and support economic reconciliation. As the first Indigenous-owned and led fund in Canada, they can start from a place of trust with entrepreneurs in a way that others can’t. “We are experiencing a pivot towards Indigenous ways of knowing and being in the investment world,” says Paul Lacerte, managing partner of Raven. “We’ve clearly seen that business can be a force for good, and we think it’s an imperative and an obligation now,” says Miller.
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